Bank of England’s Carney warns of climate change risk

Bank of England’s Carney warns of climate change risk

The Bank of England governor has given a stark warning that climate change poses a huge risk to global stability.

At a gathering of leading insurers at Lloyd’s of London, Mark Carney pointed out the rapid increase in weather-related catastrophes and the jump in both the physical and financial costs.

He said the challenges currently posed by climate change “pale in significance compared with what might come”.

He said this generation had little incentive to avert future problems.

He avoided spelling out what was causing this apparent change, but said evidence was mounting of man’s role in climate change.

Insurers are among those with the biggest interest in climate change as the syndicates operating at Lloyd’s, try the world’s oldest insurance market, are the most exposed to disasters such as hurricanes and floods.

Mr Carney said the after-effects of such disasters were likely to grow worse: “The challenges currently posed by climate change pale in significance compared with what might come.

“The far-sighted amongst you are anticipating broader global impacts on property, migration and political stability, as well as food and water security.”

But he said because the cost would fall on future generations there was little impetus on the current one to fix it: “In other words, once climate change becomes a defining issue for financial stability, it may already be too late.”